Parental means test for the Assistance for Isolated Children Scheme

Related services

Under the scheme, only Additional Boarding Allowance is income tested.

There are two parts to the parental means test:

parental income test, and

maintenance income test

Parental income and boarding costs

In 2017, we look at your income for the 2015-16 financial year.

How your income for tax year 2015-16 affects your payment

Parental income

Effect on payment

$51,903 or less

No change, however it may still be affected by the maintenance income test.

More than $51,903

Reduced by 20 cents for every dollar over. This depends on number of children in your family pool.

Boarding costs affect the amount of Additional Boarding Allowance you get. Boarding costs include boarding charges, plus $250 to cover items like laundry and toiletries. Boarding charges are the net boarding fees actually charged by the institution. It doesn't include fees for tuition or items relating to it.

If the boarding charges for the year are less than $7,845, you can only get Basic Boarding Allowance.

If the boarding charges for the year are $7,845 or more, the amount of Additional Boarding Allowance will be the lower amount of:

the maximum annual rate less any reduction from the parental income test or the maintenance income test, or

the level of annual boarding costs for the student that’s more than the Basic Boarding Allowance amount

Types of income tested

The parental income test uses parents' or guardians' combined taxable and other income for the tax year prior to the student's study year. We call this the base tax year. For example, if the student starts studying in 2017, we use the combined parental income for the 2015-16 tax year.

Parental income includes:

combined parental taxable income

tax free pensions and benefits

fringe benefits

income from outside Australia

reportable superannuation contributions, and

total net investment losses such as negative gearing losses for that tax year

We deduct child support or maintenance for a former partner you pay from the parental income.

If you want to claim Additional Boarding Allowance and haven’t given us your income details, call us.

Family pool

The family pool refers to the dependent children in your family who may affect the amount of Additional Boarding Allowance you get.

Your family pool includes dependent children who:

get Youth Allowance, ABSTUDY Living Allowance or income tested School Fees Allowance Group 2

you get Assistance for Isolated Children Additional Boarding Allowance for, or

are aged up to 19 years old, and, if aged between 16 to 19, attend secondary school

If there’s a shared care arrangement in place for a child in your family, we may take this into account.

You may be eligible for a higher rate of Additional Boarding Allowance if:

you don’t get the maximum rate of Additional Boarding Allowance

parental income is over $51,903, and

there are 2 or more dependent children in the family pool

If parental income is over $63,481, you can usually only get Basic Boarding Allowance. You may get Additional Boarding Allowance when parental income is higher if:

you’re eligible for Family Tax Benefit Part A for the child you’re claiming Additional Boarding Allowance for, or

Changes to parental income in the study year

If you get Additional Boarding Allowance, you must tell us if there’s any changes to parental income. Sometimes, changes to parental income can mean your payment rate changes. Your payment may also change if the student's circumstances change.

Where there’s been a change to parental income, we can work out the parental income test on their income for the current tax year. For example, if the student is studying in 2017 and parental income significantly changes, we may use parental income for the 2016-17 tax year.

You need to tell us if parental income:

increases more than 25% from the 2015-16 tax year

decreases significantly, and you think it will reduce for 2 years or more

You need to tell us about changes in your income so we pay you the right amount. You can do this online using your Centrelink online account.

Maintenance income test

We consider the amount of child support or voluntary maintenance you get when we work out your payment.

You need to tell us about any voluntary maintenance you get if we have not made a child support assessment. If we have made a child support assessment, you don’t need to tell us these details again. We'll use information we already have to adjust your payment.

Maintenance income can include:

cash, lump sum payments and non-cash amounts

utilities charges, and

school fees and other payments made on behalf, or for the benefit, of your child

You may be exempt from this test if you or your partner:

are permanently blind, and

get:

Age Pension

Disability Support Pension, or

a Department of Veterans’ Affairs service pension or income support supplement

The maintenance income test won’t always affect your payment. You or your partner may fall under the maintenance income free area. It’s the amount of child support or voluntary maintenance you both get before maintenance income affects your payment.

The number of children you have and payments they get can also affect this amount.

Maintenance income free area per year

When you get maintenance income for:

The maintenance income free area is

Just the child who is studying

$1,587.75

The child and other siblings who get Youth Allowance, ABSTUDY Living Allowance or School Fees Allowance Group 2

$1,587.75 plus $529.25 for each sibling. Then divide the total by the number of children

The child and other siblings who are eligible for Family Tax Benefit or Assistance for Isolated Children Additional Boarding Allowance

$529.25

Example of maintenance income free area calculation

Michael has 3 children. Michael gets Assistance for Isolated Children Additional Boarding Allowance for one child. Michael’s other 2 children get Youth Allowance. We calculate Michael’s maintenance income free area by adding the income free area for each child and dividing by 3.

The maintenance free area for the first child is $1,587.75. We add $529.25 for each of the 2 other children. We divide the total amount $2,646.25, by the total number of children. So, Michael’s maintenance income free area is $882.08.